UNITED GRAND LODGE OF ENGLAND v THE COMMISSIONERS FOR HIS MAJESTY’S REVENUE AND CUSTOMS [2023] UKUT 00307 (TCC)
| Jurisdiction | UK Non-devolved |
| Judge | JUDGE PHYLLIS RAMSHAW,JUDGE KEVIN POOLE |
| Subject Matter | 20 December 2023 |
| Court | Upper Tribunal (Tax and Chancery Chamber) |
| Published date | 20 December 2023 |
Neutral Citation: [2023] UKUT 00307 (TCC)
Case Number: UT/2022-000009
UPPER TRIBUNAL
(Tax and Chancery Chamber) Hearing Venue: The Rolls Building,
Fetter Lane, London EC4A 1NL
Value Added Tax, Exemptions, Item 1(e) of Group 9 of Schedule 9 Value Added Tax Act 1994,
Article 132(1)(l) Council Directive 2006/112/EC – whether FTT failed to give reasons for
rejecting part of Appellant’s case – yes – whether aim to provide Relief to Freemasons and
their dependents is philanthropic – no
Heard on: 24 and 25 April 2023
Judgment date: 19 December 2023
Before
JUDGE PHYLLIS RAMSHAW
JUDGE KEVIN POOLE
Between
UNITED GRAND LODGE OF ENGLAND Appellant
and
THE COMMISSIONERS FOR HIS MAJESTY’S REVENUE AND CUSTOMS
Respondents
Representation:
For the Appellant: Owain Thomas KC, counsel, instructed by KPMG Law, KPMG LLP
For the Respondents: Howard Watkinson, counsel, instructed by the General Counsel and
Solicitor to His Majesty’s Revenue and Customs
1
DECISION
INTRODUCTION
1. This appeal concerns an exemption from Value Added Tax (“VAT”) that would
otherwise be chargeable on supplies made by the Appellant to its members in return for
subscription fees. The Appellant is referred to as “UGLE” by the FTT and was also referred to
as such in two previous decisions. We refer throughout this decision to the parties as “the
Appellant” and “HMRC” respectively.
2. The Appellant appeals against a decision of the First Tier Tribunal (Tax Chamber) (“the
FTT”) released on 1 September 2021 ([2021] UKFTT 308 (TC) (“the FTT decision”)). The
FTT dismissed the Appellant’s appeal against HMRC’s decision to reject two claims for
repayment of VAT that the Appellant had accounted for. The claims were made on the basis
that the Appellant’s supplies to its members in relation to subscription fees ought to have been
treated as exempt from VAT under Article132(1)(l) of Council Directive 2006/112/VAT (the
“PVD”), applying to certain organisations with “aims of a… philosophical, philanthropic or
civic nature”.
3. The FTT held that if an organisation had more than one aim, its eligibility for the relief
would depend on its main (or primary) aim, and if it had multiple main aims, it would only
qualify for the relief if all its main aims fell within the list in Article 132(1)(l) of the PVD. If
it had a number of aims which were all equally important (i.e. if it had no main aim), then all
those aims would have to fall within the list to enable the organisation to qualify for exemption.
There is no appeal against this aspect of the FTT Decision.
4. The FTT decided that the Appellant had a philosophical aim that was a central or main
aim but that it also had another main aim of at least equal importance to the philosophical aim,
namely the provision of “Relief” in two forms: donations to good causes unconnected with
Freemasonry (which it regarded as philanthropic) and supporting Freemasons and their
dependents in distress (which it regarded as “self-insurance” rather than philanthropic in
nature). It considered that each of these two elements was, in its own right, a main aim, but
the support of Freemasons and their dependents in distress was the more important of the two
elements during the relevant period. It went on to say that:
It does not matter whether the provision of Relief is regarded as two aims, one
philanthropic and one non-philanthropic, or, alternatively, a single aim which is a
mixture of philanthropic and non-philanthropic activities. In either case, I find that
UGLE had a main aim which was not ‘philanthropic’ within Art 132(1)(l).
5. The FTT therefore concluded that the services supplied by the Appellant were not
exempt from VAT.
6. The FTT also decided that the Appellant does not have a civic aim – no appeal against
that aspect of the FTT’s decision has been made.
7. The FTT rejected HMRC's submission that, in addition to falling within the list at Article
132(1)(l) of the PVD, an organisation's aim (or main aim/s) must also be in the public interest
before it would qualify for the exemption. There is no appeal against that conclusion.
8. Permission to appeal was granted by the Upper Tribunal on two specific grounds. The
grounds of appeal are set out below.
9. All references to paragraph numbers in this decision are to paragraphs in the FTT
decision unless otherwise indicated.
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